In this article, we will be discussing 2 stocks concerning clean energy which investors need to keep on their radar.
1) Sterling & Wilson Renewable Energy:
- Sterling & Wilson Renewable Energy is an engineering, procurement, and construction (EPC) service provider.
- It is one of the leading EPC players all over the world.
- The company has a major focus on solar projects. They have an operation in more than 23 countries and have worked on over 256 projects till now, out of which 216 projects have been commissioned or completed.
- The company also works on servicing contracts as well.
- The Company is having a portfolio of around 11.4 Gigawatts and still has made applications for several projects and is expecting some major projects in hand in the year 2022.
- The current EPC book or the order book is around worth Rs. 7,900 Cr., and the yearly revenue of the company hovers between Rs. 6,000 Cr. to Rs. 8,000 Cr., which shows that the next 1-year order book is in its hand, and the company’s expectation for getting new projects in FY22 is higher. Though large EPC projects with a total capacity of 400 megawatts are being constructed in the United States of America which might be commissioned by the end of 2022.
- The market size of operations and maintenance of solar projects is around $4 billion and is expected to reach $9 billion by 2024 indicating the doubling of the market size in the next two years.
- Despite the good business and industry prospects, the company has been posting continuous loss regularly, the major reason behind that is the rise in raw material cost.
- Also, Reliance Industries Limited through its renewable energy subsidiary has acquired a 40% stake in this company. Reliance Industries will be investing around Rs. 75,000 Cr. in the Clean Energy Green Energy.
2) Tata Power:
- Tata Power is having a total capacity of 12.8 Gigawatts, out of which only 31% belongs to Renewable energy which comes to around 4 Gigawatts.
- The company has set a target to increase this renewable energy capacity to 15 Gigawatts by 2025 equivalent to a growth of 4 times. On an annual basis, the company wants to add 2 Gigawatts every year.
- The company is also trying to set up solar energy outlets in the individual houses where it is mainly targeting rural areas.
- Under its “Kshitij” Solar Pump initiative, the company has been able to install 53,000 pumps.
What Should Shareholders Do?
The Sterling & Wilson Renewable Energy Limited belongs to Shapoorji Pallonji Group which is a strong group itself, but the investment of Reliance Industries, one of the biggest private business groups in the country is a positive development for the company. While Tata Power is now aggressively focusing on the Renewable Energy segment and has also some of the initiatives like ‘Kshitij’, which is doing quite well. Hence, Investors looking for some exposure to clean energy space, then they should have these 2 stocks on their radar.